The early optimism in equities have all but faded with US futures and European indices all nudging lower after a decent start. S&P 500 futures are down 4 points, or 0.1%, while major indices in Europe are struggling with the DAX down 0.3%, CAC 40 flat, and UK FTSE down 0.4% at the moment.
This comes alongside a push higher in bond yields as noted here and put together, is keeping the dollar in control so far in European morning trade. EUR/USD is keeping lower, down 0.3% to 0.9820 levels at the moment:
The latest bounce appears to be stalling near the 61.8 Fib retracement level when viewed on the daily chart, which sits around 0.9859. The near-term bias remains more bullish but as gains are interrupted, we could see sellers look to try and run towards a test of the 100-hour moving average (red line) next.
Besides that, USD/JPY continues to lurk towards intervention territory as noted here. The pair is up 0.1% to 149.40 as buyers remain cautious in overextending in fear of triggering action by Japanese authorities.
Meanwhile, GBP/USD is pinned down by 0.5% to 1.1265 as sellers start to regain some near-term control as pointed out here following the slightly higher UK inflation figures.
As risk hits the skids, commodity currencies are also starting to struggle with USD/CAD up 0.2% to 1.3765 while AUD/USD is down 0.2% to just below 0.6300 at the moment:
Despite the rousing rally in equities over the past few sessions, AUD/USD price action shows what a tepid bounce that is all amounting to in the major currencies space. Gains are limited closer to 0.6340-45 and we are seeing sellers keep the pressure in search of a break below 0.6200 before targeting 0.6000 next.